UK-Registered Firm Sole Contender For Armenian Power Grids

A Canadian-owned company registered on the British Channel Islands is the only contender for an 80 percent share in Armenia’s national power distribution network, officials confirmed on Wednesday.

According to Deputy Energy Minister Areg Galstian, Midland Resources Holding, is the only foreign company to have submitted a package of proposals before the expiry of the August 7 deadline for the first, pre-qualification stage of the bidding.

“They submitted all required documents,” Galstian told RFE/RL. “The tender commission will meet in the coming days to consider their package and make a decision.”

Midland Resources, which has already invested in Armenia’s agricultural sector, was touted as the likely new owner of the Armenian power utilities after the government’s unexpected decision late last month to again put them up for sale. Informed sources revealed to RFE/RL last week that representatives of the little known firm have been carrying out confidential negotiations with officials in Yerevan over the terms of the impending deal.

However, Galstian claimed that a deal with Midland should not be considered a forgone conclusion. He argued that five major Western and Russian firms short-listed last year for the final stage of similar energy tenders last year may still bid for the Armenian Electricity Network (AEN). But he admitted that none of them has so far shown interest in doing so.

Midland’s main business partner in Armenia, parliament deputy Harutiun Pambukian, said the offshore-registered company is ready to invest between $80 million and $120 million in the Armenian energy sector in the next five years. But he declined to specify the price to be offered by the company for AEN.

According to Pambukian, Midland Resources is owned by Alex Schneider, a Canadian national, and holds a majority stake in the Zhaporozhstal steel factory in Ukraine. It also owns 50 percent of the Armenian agricultural company Max Fruit, of which Pambukian is also a key shareholder.

Earlier this year Max Fruit purchased 12,000 hectares of agricultural land in southern Armenia which it will cultivate for growing cereals and fruits. Pambukian said the Canadian businessman has already invested $7 million in the undertaking.